Cars and Drivers

Does Drop in Driver's Licenses Warn of Drop in Auto Sales?

Paul Ausick

Published: January 19, 2016 11:15 am

Last Updated: January 13, 2020 2:53 pm

New car sales in the United States totaled around 17.5 million in 2015, a record-setting year for carmakers. A reasonable question is how long booming car sales can last if fewer Americans are licensed to drive?

According to new research from Michael Sivak and Brandon Schoettle of the University of Michigan Transportation Research Institute, there has been a continuous decline in the percentage of Americans with driver’s licenses in the 16- to 44-year-old age group in each of the four years examined in the period between 1983 and 2014.

In 1983, 46.2% of 16-year-olds had a driver’s license. That percentage fell to 31.1% in 2008, to 27.5% in 2011 and 24.5% in 2014. Among Americans 20 to 24 years of age, 91.8% had driver’s licenses in 1983 compared with 82% in 2008, 79.7% in 2011 and 76.7% in 2014.

The only age groups that show growth in the years covered by the study are 55- to 59-year-olds, 60- to 64-year-olds and 65- to 69-year-olds. These are the baby boomers, and the percentages are likely increasing due to high numbers to start with and, now, higher mortality rates (our observation, not the institute’s).

Should automakers be concerned? In the 25 years between 1983 and 2008, the average decline in the number of 16-year-olds who had a driver’s license was about 1.6% a year. Among 20- to 24-year-olds, the decline averaged about 0.5% a year.

The low numbers reported for 2014 could be due to several factors. First, more younger Americans live in cities with at least good-enough public transportation systems. Second, the rise of ride-sharing programs like Uber and Lyft have almost certainly had some effect. For a lot of young urban dwellers, getting a driver’s license is just more time and expense than it’s worth.

If, as many expect, self-driving or autonomous cars are proven safe and widely adopted, that is likely to have a bigger impact on auto sales than people without a driver’s license. That day is probably still a ways off, but nearer than most of us care to contemplate.